New York's hydrofracking review nearing final stages

Dec. 1, 2012

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ALBANY — A week filled with regulatory maneuvering in New York has supporters of shale-gas drilling hoping for the best, critics fearing for the worst and environmental regulators straining to stay somewhere in between.

With environmental attorneys closely scrutinizing the state Department of Environmental Conservation’s every move and the gas industry pushing for a speedy resolution, New York’s future with — or without — hydraulic fracturing could finally begin to take shape over the next three months.

“We hope and trust that the end of this decision-making process is now firmly in sight, and know that once it is done, the economic renewal of the Southern Tier is just around the corner,” said Karen Moreau, executive director of the New York State Petroleum Council, an industry trade group.

High-volume hydrofracking hasn’t been allowed in New York — part of which sits above the gas-rich Marcellus Shale in the Southern Tier — as the state continues work on an environmental review that was launched more than four years ago.

Industry boosters and fracking critics have taken the DEC’s decision to file for a 90-day extension on a Nov. 29 regulatory deadline as a sign that Gov. Andrew Cuomo’s administration could seek to make a determination on shale-gas drilling by the end of February.

To receive that extension, the DEC was required by state law to release a new set of proposed rules for drilling and hydrofracking in New York. While the new proposals would allow large-scale hydrofracking with certain setbacks and safety restrictions, a DEC spokeswoman on Friday cautioned against reading tea leaves.

“If DEC decides that hydraulic fracturing cannot be safely done in New York, these regulations will not have any practical effect and the process will not go forward,” Emily DeSantis said in a statement. Otherwise, she said, the proposals would be adjusted according to the recommendations of the agency’s ongoing environmental and health reviews.

Three academic health experts were tapped by the state in mid-November to assist in its review and make recommendations on how to prevent or limit the potential negative effects of gas drilling. A final decision on high-volume hydrofracking won’t come until that review is completed, according to the DEC.

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“The administration has basically pledged that there’s not going to be a final product until the public-health review is complete and disclosed,” said Travis Proulx, a spokesman for Environmental Advocates of New York. “If they’re going to keep that pledge, that means that the regulations we are looking at today are irrelevant and have no bearing.”

The newly proposed regulations will be open to public comment from Dec. 12 through Jan. 11. The comment period is expected to garner thousands of responses that will have to be assessed by the DEC. Given the amount of work that would need to be completed over the next 90 days, Proulx cast doubt on whether the agency could adequately finish it on time.

“There is no conceivable way they can credibly keep all of the promises they have made within the 90-day window they have boxed themselves into,” he said.

Attorneys on both sides of the gas-drilling debate on Friday continued to sift through the 90 pages of proposed rules, which were publicly unveiled by the DEC late Thursday with little fanfare or explanation.

There appeared to be numerous tweaks from the agency’s originally proposed regulations, which were released in September 2011. In various places, language is tightened, expanded or made more specific, while setbacks and safety requirements in some instances have been increased or changed.

“It’s going to be slightly more difficult for industry than the version that was proposed in 2011,” said Yvonne Hennessy, an Albany-based oil-and-gas attorney at Hiscock & Barclay LLP. “It certainly hasn’t gotten any easier, but I haven’t seen anything that I think is a major stopgap that would make drilling impossible in New York.”

The Independent Oil & Gas Association of New York, a state-based trade group, expressed dissatisfaction with the new proposals, which they say are more restrictive than the 2011 rules.

In particular, the DEC’s new rules include a few new restrictions, such as a ban on fracking within 500 feet of a water supply for livestock or crops.

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Another rule suggests the agency might charge gas companies a fee to recover costs for the state’s ongoing review of hydrofracking.

“Nonetheless, we are pleased that there is progress toward ending the four-plus-year delay,” said Brad Gill, the gas industry group’s executive director.

“Only time will tell how oil and natural gas producers will now view New York compared to other states.”

If the DEC misses the February deadline, it would be forced to restart the rule-making process — a move that would require yet another public comment period. The agency could move to issue permits without formal regulations on the books, but it would likely generate a legal challenge from environmentalists.

Regardless of the DEC’s ultimate decision, lawsuits are expected whenever it is reached.

“Certainly, I think everyone anticipates there will be litigation of some sort once this process is completed,” said Kate Sinding, a senior attorney for the Natural Resources Defense Council.

Deborah Goldberg, managing attorney for environmental law firm Earthjustice, said she believes seeking the 90-day extension signals the DEC is aiming to meet the latest deadline.

“My understanding is they (DEC) feel they are not bound by this and they can always start over,” she said.